Global marketing

Cover......Page 1
Half Title Page......Page 2
Title Page......Page 4
Copyright Page......Page 5
Brief Contents......Page 6
Contents......Page 8
Preface......Page 19
Acknowledgements......Page 35
Publisher’s acknowledgements......Page 37
Abbreviations......Page 42
About the author......Page 46
PART I THE DECISION WHETHER TO INTERNATIONALIZE......Page 48
 Part I Video case study: Uber......Page 49
  Learning objectives......Page 50
  1.2 The process of developing the global marketing plan......Page 51
  1.3 Comparison of the global marketing and management style of SMEs and LSEs......Page 52
   Exhibit 1.1 LEGO’s strategic drift......Page 59
   Exhibit 1.2 Economies of scale with Nintendo Game Boy......Page 61
   Exhibit 1.3 Ford Focus Global Marketing Plan......Page 63
  1.4 Should the company internationalize at all?......Page 64
  1.5 Development of the ‘global marketing’ concept......Page 65
   Exhibit 1.5 Persil Black & Persil abaya = glocalization (same product, but  different packaging and market communication)......Page 68
  1.6 Forces for global integration and market responsiveness......Page 69
   Exhibit 1.6 McDonald’s is moving towards a higher degree of market  responsiveness......Page 72
  1.7 The value chain as a framework for identifying international competitive advantage......Page 73
  1.8 Value shop and the ‘service value chain’......Page 79
  1.9 Global experimental marketing......Page 83
   Exhibit 1.7 Case Construction Equipment is using experiential marketing......Page 86
   Exhibit 1.8 IKEA’s use of AR......Page 87
  1.10 Information business and the virtual value chain......Page 88
  1.11 Summary......Page 89
   1.1 Green Toys, Inc.: a manufacturer of eco-friendly toys is going international......Page 90
   1.2 Hunter Boot Ltd: The iconic British brand is moving into exclusive fashion......Page 95
   1.3 Video case study: Nivea......Page 97
  References......Page 98
  Learning objectives......Page 100
  2.2 Internationalization motives......Page 101
   Exhibit 2.1 Jägermeister: the famous herbal liqueur is going global as a result of ‘managerial urge’ in the family-owned company......Page 103
   Exhibit 2.2 Global marketing and economies of scale in Japanese firms......Page 106
   Exhibit 2.3 Internationalization of Haier – proactive and reactive motives......Page 109
  2.3 Triggers of export initiation (change agents)......Page 110
  2.4 Internationalization barriers/risks......Page 114
   Exhibit 2.4 De-internationalization at British Telecommunications (BT)......Page 118
   2.1 LifeStraw: Vestergaard-Frandsen transforms dirty water into clean drinking water......Page 120
   2.2 Elvis Presley Enterprises Inc. (EPE): internationalization of a cult icon......Page 123
   2.3 Video case study: TOMS Shoes......Page 124
  References......Page 125
  Learning objectives......Page 127
  3.1 Introduction......Page 128
  3.2 The Uppsala internationalization model......Page 130
  3.3 The transaction cost analysis (TCA) model......Page 134
  3.4 The network model......Page 137
  3.5 Born globals......Page 139
   Exhibit 3.1 K-pop – a ‘born global’ phenomenon has worldwide success......Page 140
  3.6 Summary......Page 144
   3.1 Zumba: a dance phenomenon is going global......Page 145
   3.2 Dreamworks Classics: internationalization of Postman Pat......Page 148
  References......Page 149
  Learning objectives......Page 152
  4.2 Analysis of national competitiveness (the Porter diamond)......Page 153
  4.3 Competition analysis in an industry......Page 158
  4.4 Value chain analysis......Page 163
   Exhibit 4.1 Hilti is selling the ‘use’ – not the product......Page 165
  4.6 Corporate social responsibility (CSR)......Page 176
   Exhibit 4.2 Chiquita – integrating CSR in the resource base......Page 178
  4.7 The value net......Page 180
   Exhibit 4.3 Value net – cooperation/competition between competitors within each airline alliance. The three alliances are competing against each other......Page 181
  4.8 Blue ocean strategy and value innovation......Page 182
   Exhibit 4.4 Hotel Formule 1 – value innovation in action......Page 184
  4.9 Summary......Page 186
   4.1 Nintendo Wii: Nintendo’s Wii took first place on the world market – but it didn’t last......Page 187
   4.2 DJI Technology Co. Ltd: a Chinese ‘born global’ is dominating the world market for drones with its Phantom......Page 193
  References......Page 197
   I.1 Zara: the Spanish retailer goes to the top of world fashion......Page 200
   I.2 Manchester United: still trying to establish a global brand......Page 206
   I.3 Adidas: the No. 2 in the global sportswear market is challenging the No. 1, Nike......Page 210
   I.4 Cereal Partners Worldwide (CPW): the No. 2 world player is challenging the No. 1, Kellogg......Page 217
PART II DECIDING WHICH MARKETS TO ENTER......Page 226
 Part II Video case study: HondaJets – Honda enters the small-sized business jet market......Page 228
  Learning objectives......Page 230
  5.2 The changing role of the international researcher......Page 231
  5.3 Linking global marketing research to the decision-making process......Page 232
  5.4 Secondary research......Page 234
  5.5 Primary research......Page 238
  5.6 Other types of marketing research......Page 249
  5.7 Marketing research based on Web 2.0......Page 253
   Exhibit 5.1 Amazon.com – sustaining a competitive advantage through market research and analytics......Page 254
  5.8 Setting up an international marketing information system (MIS)......Page 255
  5.9 Summary......Page 256
   5.1 Teepack Spezialmaschinen GmbH: organizing a global survey of customer satisfaction......Page 257
   5.2 LEGO Friends: one of the world’s largest toy manufacturers moves into the girls’ domain......Page 258
  Questions for discussion......Page 261
  References......Page 262
  Learning objectives......Page 263
  6.2 The political/legal environment......Page 264
   Exhibit 6.1 Huawei Technologies Corporation: the role of home government in the internationalization process......Page 266
   Exhibit 6.2 Google is experiencing political risk in China......Page 270
  6.3 The economic environment......Page 275
   Exhibit 6.3 EU’s antitrust regulator complains about competition practices of Google......Page 280
  6.4 The European Economic and Monetary Union and the euro......Page 281
  6.5 BRIC – the show growth is hitting the emerging countries......Page 283
   Exhibit 6.4 ChotuKool – Indian Godrej is creating a disruptive innovation (a low-cost refrigerator) for the BOP market......Page 285
  6.6 ‘Bottom of pyramid’ (BOP) as a market opportunity......Page 286
   Exhibit 6.5 Vodacom – reaching both BOP (bottom of pyramid) customers and BOP entrepreneurs in Africa......Page 288
   Exhibit 6.6 Voltic Cool Pac – distribution of water in Ghana......Page 289
  6.7 Summary......Page 290
   6.1 G-20 and the economic and financial crises: what on earth is globalization about? Protests during a meeting in Brisbone, Australia, November 2014......Page 292
   6.2 Danfoss Power Solutions: which political/economic factors would affect a manufacturer of hydraulic components?......Page 293
   6.3 Video case study: Debate on globalization......Page 294
  References......Page 295
  Learning objectives......Page 296
  7.1 Introduction......Page 297
  7.2 Layers of culture......Page 298
  7.3 High- and low-context cultures......Page 300
  7.4 Elements of culture......Page 302
   Exhibit 7.2 In China the Citroën C4 brand name was changed to Citroën c-Quatre......Page 303
   Exhibit 7.3 Sensuality and touch culture in Saudi Arabian versus European advertising......Page 305
   Exhibit 7.4 Polaroid’s success in Muslim markets......Page 309
  7.5 Hofstede’s model, (the ‘4 + 1’ dimensions model) versus the GLOBE model......Page 310
  7.6 Managing cultural differences......Page 312
  7.7 Convergence or divergence of the world’s cultures......Page 313
  7.8 The effects of cultural dimensions on ethical decision-making......Page 314
   Exhibit 7.6 The quest for beauty opens a huge market for whitening products in Asia......Page 316
  7.9 Summary......Page 317
   7.1 Cirque du Soleil Inc.: the show that revolutionized the circus arts is expanding its global scope......Page 318
   7.2 The IKEA catalogue: are there any cultural differences?......Page 320
  Questions for discussion......Page 322
  References......Page 323
  Learning objectives......Page 324
  8.2 International market selection: SMEs versus LSEs......Page 325
  8.3 Building a model for international market selection......Page 326
   Exhibit 8.1 Bosch Security Systems: IMS in the Middle East for fire detection systems......Page 340
   Exhibit 8.2 Sunquick’s waterfall approach......Page 344
   Exhibit 8.3 An example of the ‘trickle-up’ strategy......Page 346
   Exhibit 8.4 Bajaj is selecting new international markets ignored by global leaders......Page 350
  8.6 Summary......Page 351
   8.1 Tata Nano: international market selection with the world’s cheapest car......Page 353
   8.2 Philips Lighting: screening markets in the Middle East......Page 358
  Questions for discussion......Page 361
  References......Page 362
   II.1 Sodastream: Managing profitable growth in an increasingly  competitive global environment......Page 363
   II.2 The Female Health Company (FHC): the female condom is seeking a foothold  in the world market for contraceptive products......Page 369
   II.3 Zalando: how can the online apparel retailer turn financial losses into  positive profits?......Page 372
   II.4 Ferrari: international market selection (IMS) for the exclusive sports car brand......Page 380
PART III MARKET ENTRY STRATEGIES......Page 388
 Part III Video case study: Müller Yogurts – entering the US market......Page 392
  Learning objectives......Page 394
  9.2 The transaction cost approach......Page 395
  9.3 Factors influencing the choice of entry mode......Page 397
   Exhibit 9.1 Zara is modifying its preferred choice of entry mode, depending on the psychic distance to new markets......Page 401
   9.1 Jarlsberg: the king of Norwegian cheeses is deciding on entry modes into new markets......Page 403
   9.2 Ansell condoms: is acquisition the right way to gain market shares in the European condom market?......Page 405
  References......Page 409
  Learning objectives......Page 410
  10.1 Introduction......Page 411
  10.2 Indirect export modes......Page 413
  10.3 Direct export modes......Page 417
   Exhibit 10.1 Lofthouse of Fleetwood’s (Fisherman’s Friend) decision criteria -when selecting new distributors......Page 419
  10.4 Cooperative export modes/export marketing groups......Page 424
  10.5 Summary......Page 425
   10.1 Lysholm Linie Aquavit: international marketing of the Norwegian Aquavit brand......Page 426
   10.2 Parle Products: an Indian biscuit manufacturer is seeking agents and cooperation partners in new export markets......Page 428
  Questions for discussion......Page 430
  References......Page 431
  Learning objectives......Page 432
  11.2 Contract manufacturing......Page 433
  11.3 Licensing......Page 434
  11.4 Franchising......Page 437
   Exhibit 11.1 Build-a-Bear workshop’s use of the indirect franchising model in Germany – Austria - Switzerland......Page 439
  11.5 Joint ventures/strategic alliances......Page 443
   Exhibit 11.2 Irn-Bru’s distributor alliance (Y coalition) with Pepsi Bottling Group (PPG) in Russia......Page 445
   Exhibit 11.3 Safedom: a Chinese condom manufacturer needs a partner with which to enter the European market......Page 453
  11.6 Other intermediate entry modes......Page 454
   11.1 Hello Kitty: can the cartoon cat survive the buzz across the world?......Page 457
   11.2 Kabooki: licensing in the LEGO brand......Page 460
   11.3 Video case study: Marriott......Page 462
  References......Page 463
  Learning objectives......Page 465
  12.1 Introduction......Page 466
   12.3 Resident sales representatives/foreign sales branch/foreign sales subsidiary......Page 467
  12.4 Sales and production subsidiary......Page 469
  12.5 Subsidiary growth and integration strategies......Page 470
  12.6 Region centres (regional HQ)......Page 472
  12.7 Transnational organization......Page 473
  12.8 Establishing wholly owned subsidiaries – acquisition or greenfield......Page 474
  12.9 Location/relocation of HQ......Page 475
   Exhibit 12.1 Tesco’s withdrawal from Japan in 2012 after nine years......Page 476
   Exhibit 12.2 Walmart’s withdrawal from the German market......Page 478
  12.11 Summary......Page 480
   12.1 Polo Ralph Lauren: Polo moves distribution for South-east Asia in-house......Page 481
   12.2 Durex condoms: SSL will sell Durex condoms in the Japanese market through its own organization......Page 483
   12.3 Video case study: Starbucks......Page 484
  References......Page 485
  Learning objectives......Page 486
  13.1 Introduction......Page 487
  13.2 Reasons for international sourcing......Page 488
  13.3 A typology of subcontracting......Page 490
  13.4 Buyer–seller interaction......Page 491
  13.5 Development of a relationship......Page 494
  13.6 Reverse marketing: from seller to buyer initiative......Page 497
  13.7 Internationalization of subcontractors......Page 498
   Exhibit 13.1 An example of Japanese network sourcing: the Mazda seat-sourcing case......Page 500
  13.8 Project export (turnkey contracts)......Page 501
  13.9 Summary......Page 502
   13.1 ARM: challenging Intel in the world market of computer chips......Page 503
   13.2 Bosch Indego: how to build B2B and B2C relationships in a new global product market – robotic lawnmowers......Page 507
   13.3 Video case study: Kone elevators and escalators......Page 510
  References......Page 511
   III.1 Raleigh Bicycles: does the iconic bicycle brand still have a chance  on the world market?......Page 513
   III.2 Netflix Inc.: the US internet subscription service company is dominating  the television and movies streaming world......Page 518
   III.3 Autoliv Airbags: transforming autoliv into a global company......Page 525
   III.4 IMAX Corporation: globalization of the film business......Page 530
PART IV DESIGNING THE GLOBAL MARKETING PROGRAMME......Page 536
 Part IV Video case study: Tequila Avión......Page 543
  Learning objectives......Page 544
  14.3 Developing international service strategies......Page 545
  14.4 The product life cycle......Page 551
   Exhibit 14.2 The iOS (Apple)/Android (Google) global contest in the smartphone business......Page 555
   Exhibit 14.3 Threadless T-shirt crowdsourcing business......Page 558
  14.5 New products for the international market......Page 560
  14.6 Product positioning......Page 566
   Exhibit 14.5 Chinese piano manufacturers are experiencing the ‘country of origin’ (COO) effect......Page 567
   Exhibit 14.6 Madame Tussauds – a brand that brings people closer to celebrities on a global basis......Page 568
  14.7 Brand equity......Page 569
  14.8 Branding decisions......Page 570
   Exhibit 14.7 Unilever’s Snuggle fabric softener – an example of local brands in multiple markets......Page 571
   Exhibit 14.8 Kellogg under pressure to produce under Aldi’s own label......Page 575
   Exhibit 14.9 Shell’s co-branding with Ferrari and LEGO......Page 576
   Exhibit 14.10 Roundup – a global brand for multiple markets......Page 577
  14.9 Sensory branding......Page 579
   Exhibit 14.12 Starbucks’ expanding product line strategy is causing problems for its ‘scent marketing strategy’......Page 582
  14.10 Implications of the internet for collaboration with customers on product decisions......Page 583
  14.11 3-D printing – a possible new industrial revolution in customization......Page 586
  14.12 Global mobile app marketing......Page 587
   Exhibit 14.13 L’Oreal is extending the customers’ buying experience with the mobile app Makeup Genius......Page 589
  14.13 ‘Long tail’ strategies......Page 590
  14.14 Brand piracy and anti-counterfeiting strategies......Page 591
   Exhibit 14.14 The next stage in pirating, faking an entire company – NEC......Page 592
   14.1 Danish Klassic: launch of a cream cheese in Saudi Arabia......Page 593
   14.2 Zippo Manufacturing Company: has product diversification beyond the lighter gone too far?......Page 597
   14.3 Video case study: Burberry branding......Page 598
  Questions for discussion......Page 599
  References......Page 600
  Learning objectives......Page 603
  15.3 Factors influencing international pricing decisions......Page 604
  15.4 International pricing strategies......Page 608
   Exhibit 15.1 German car manufacturers are using ‘skimming’ price strategy in China......Page 609
   Exhibit 15.2 A ‘market pricing’ (‘mass point’) strategy in use: the Converse brand is making a comeback under Nike ownership......Page 611
   Exhibit 15.3 Volkswagen Group’s product portfolio approach to pricing......Page 615
   Exhibit 15.4 The Gillette price premium strategy......Page 616
   Exhibit 15.5 Kodak is following the reverse ‘buy-in/follow-on’ strategy for its printer and cartridge division......Page 617
  15.5 Implications of the internet for pricing across borders......Page 626
  15.6 Terms of sale and delivery......Page 628
  15.7 Terms of payment......Page 630
  15.8 Export financing......Page 633
  15.9 Summary......Page 635
   15.1 Harley-Davidson: does the image justify the price level?......Page 636
   15.2 Gillette Co.: is price standardization possible for razor blades?......Page 637
   15.3 Video case study: Vaseline pricing strategy......Page 638
  Questions for discussion......Page 639
  References......Page 640
  Learning objectives......Page 642
  16.1 Introduction......Page 643
  16.2 External determinants of channel decisions......Page 644
  16.3 The structure of the channel......Page 646
   Exhibit 16.1 Burberry: the iconic British luxury brand targets 25 of the world’s wealthier cities......Page 649
  16.4 Multiple channel strategy......Page 650
   Exhibit 16.2 Dell’s use of the multi-channel distribution strategy......Page 652
  16.5 Managing and controlling distribution channels......Page 654
  16.6 Implications of the internet for distribution decisions......Page 658
  16.7 Online retail sales......Page 660
  16.8 Smartphone marketing......Page 661
   Exhibit 16.3 The ‘banana split’ model......Page 663
  16.10 Grey marketing (parallel importing)......Page 667
  16.11 Summary......Page 668
   16.1 De Beers: forward integration into the diamond industry value chain......Page 669
   16.2 Tupperware: the global direct distribution model is still working......Page 672
  Questions for discussion......Page 675
  References......Page 676
  Learning objectives......Page 677
  17.2 The communication process......Page 678
   Exhibit 17.1 Husqvarna’s consumer wheel......Page 681
  17.3 Communication tools......Page 682
   Exhibit 17.2 LEGO Ninjago’s 360 degree marketing communication......Page 687
   Exhibit 17.3 Ricola is using celebrity endorsement in the international marketing of its herbal drops......Page 691
   Exhibit 17.4 Ambush marketing strategy – Dutch Bavania vs Anheuser Busch’s Budweiser during the FIFA World Cup 2010......Page 693
  17.4 International advertising strategies in practice......Page 699
   Exhibit 17.5 Jarlsberg cheese – cross-border communication......Page 704
  17.5 Implications of the internet for communication decisions......Page 705
  17.6 Social media marketing......Page 706
   Exhibit 17.6 Generating buzz in the pre-communication stage for BMW1 Series M Coupé......Page 713
  17.7 Developing a viral marketing campaign......Page 714
  17.8 Summary......Page 715
  Case studies......Page 716
   17.2 Morgan Motor Company: can the British retro sports car brand still be successful after 100 years?......Page 718
   17.3 Video case study: BMW Motorcycles......Page 721
  References......Page 722
   IV.1 Absolut Vodka: defending and attacking for a better position  in the global vodka market......Page 724
   IV.2 Guinness: how can the iconic irish beer brand compensate  for declining sales in the home market?......Page 732
   IV.3 Dyson: the iconic vacuum cleaner manufacturer launches the robotic version......Page 740
   IV.4 Triumph Motorcycles Ltd: rising from the ashes in the international  motorcycle business......Page 750
PART V IMPLEMENTING AND COORDINATING THE GLOBAL MARKETING PROGRAMME......Page 756
 Part V Video case study: Stella & Dot......Page 757
  Learning objectives......Page 758
   Exhibit 18.1 Google gives a clock as a gift in China......Page 759
  18.2 Cross-cultural negotiations......Page 760
   Exhibit 18.2 Euro Disney becomes Disneyland Resort Paris – Disney learns to adapt to European cultures......Page 769
  18.3 Intercultural preparation......Page 770
  18.4 Coping with expatriates......Page 772
  18.5 Knowledge management and learning across borders......Page 774
  18.6 Transnational bribery in cross-cultural negotiations......Page 777
  18.7 Summary......Page 778
   18.1 ZamZam Cola: marketing of a ‘Muslim’ cola from Iran to the European market......Page 779
   18.2 TOTO: the Japanese toilet manufacturer seeks export opportunities for its high-tech brands in the US......Page 781
  Questions for discussion......Page 783
  References......Page 784
  Learning objectives......Page 786
  19.2 Organization of global marketing activities......Page 787
  19.3 The global account management organization......Page 792
   Exhibit 19.1 Danfoss Power Solutions’ GAM......Page 802
   Exhibit 19.2 AGRAMKOW – working to model 3......Page 803
  19.4 Controlling the global marketing programme......Page 804
  19.5 The global marketing budget......Page 810
  19.6 The process of developing the global marketing plan......Page 814
   19.1 Mars Inc.: merger of the European food, pet care and confectionery divisions......Page 815
   19.2 Henkel: should Henkel shift to a more customer-centric organization?......Page 816
  Questions for discussion......Page 818
  References......Page 819
   V.1 Sony Music Entertainment: new worldwide organizational structure and the marketing, planning and budgeting of Pink’s new album......Page 820
   V.2 Red Bull: the global market leader in energy drinks is considering further market expansion......Page 827
   V.3 Tetra Pak: how to create B2B relationships with the food industry on a global level......Page 837
   V.4 Polaroid Eyewear: can the iconic brand achieve a comeback in the global sunglasses industry?......Page 843
Index......Page 851